19710216 1971-3ORDINANCE NO. 1971-3
AN ORDINANCE authorizing and providing for the
issuance of $1,000,000 Water Revenue Bonds,
Series 1970, of the City of Fairfax, Virginia,
for the purpose of constructing extensions and
improvements to the municipal water system of
said City, prescribing the form of said pro-
posed bonds, providing for the payment of the
principal and interest thereof and setting
forth the terms and conditions upon which the
said bonds and additional bonds ranking on a
parity therewith are to be and may be issued
and outstanding.
WHEREAS, the City of Fairfax is a duly incorporated
and existing municipal corporation of the Commonwealth of Virginia
operating under the provisions of a Charter granted by the General
Assembly of Virginia, being Chapter 319 of the Acts of the Assembly
of 1966, as amended; and
WHEREAS, by ordinance heretofore adopted by the Council
of said City on October 27, 1970, it was proposed that said City
construct extensions and improvements to the municipal water sys-
tem of said City, same being a specific undertaking from which
said City presently derives a revenue and will continue to derive
a revenue, and in and by said ordinance it was further proposed
to borrow money and issue bonds of said City to the amount of
$1,000,000 for the purpose aforesaid under the provisions of
Paragraph (b) of Section 127 of the Constitution of Virginia and
Sections 15.1-170 et seq. of the Code of Virginia 1950, as amended,
and Chapter 8 of the Charter of said City so that said bonds are
not to be included within the limitation of indebtedness of said
City contained in Section 127 of the Constitution of Virginia and
Section 15.1-176 of the Code of Virginia 1950, as amended, but are
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to be payable as to both principal and interest exclusively from
the receipts and revenues of the undertaking~ and
WHEREAS, pursuant to an Order by the Circuit Court of
Fairfa× County entered upon filing with it of a certified copy of
said ordinance an election was duly called and held in and for said
City whereat there was submitted the question of issuing such bonds~
and
WHEREAS, from the certification of the results as filed
with this Council by the Clerk of said Circuit Court at said elec-
tion on December 8, 1970, more than a majority of the qualified
voters of said City voting upon the question voted in favor of the
issuance of said bonds, and said proposition was declared duly
carried; and
WHEREAS, said City of Fairfax presently owns and operates
the water system supplying water for public, commercial and domes-
tic purposes in and to said City and its inhabitants, and in that
connection said City presently has outstanding:
$4,050,000 principal amount of 3-3/4%_- 3-7/8%
Water Revenue Bonds dated June l, 195~ pursuant
to an ordinance adopted September 3, 1958, matur-
ing serially on June I of each of the years 1971
to 1991, inclusive, and which by their terms are
payable only from the net revenues to be derived
from the operation of said municipal water systems
and
$950,000 principal amount of 3-3/4% Water Revenue
Bonds, Series 1965, dated June l, 1965 pursuant
to an ordinance adopted June 8, 1965, maturing
serially on June I of each of the years 1990 to
1994, inclusive, and which by their terms are
payable only from the net revenues to be derived
from the operation of said municipal water system
on a parity.with said Water Revenue Bonds dated
June l, 195b;
and
WHEREAS, in and by said ordinances adopted September 3,
1958 and June 8, 1965, the right and privilege were reserved by
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said City under conditions and restrictions therein set out of
issuing additional bonds from time to time payable from the net
revenues of said municipal water system and ranking on a parity
with said bonds dated June l, 1956 and June l, 1965, which con-
ditions and restrictions are found to exist and prevail currently
so as to permit the issuance of such additional bonds to the
amount of $1,000,000 as hereinafter provided and ranking on a
parity with said presently outstanding bonds dated June l, 1956
and June l, 1965; and
WHEREAS, it is deemed necessary at this time to adopt
an ordinance authorizing and providing for the issuance of said
bonds and setting forth the terms and conditions on which said
bonds and additional bonds ranking on a parity therewith are to
be and may be issued and outstanding~
NOW, THEREFORE, Be It And It Is Hereby Ordained by the
Council of the City of Fairfax, Virginia, as follows:
Section 1. The following terms shall have the follow-
ing meanings in this ordinance unless the text otherwise express-
ly requires:
(a) "City" shall mean the City of Fairfax, Virginia.
(b) "Bonds" shall mean the $1,000,000 Water Revenue
Bonds, Series 1970, originally authorized to be issued
pursuant to this ordinance and the interest coupons attached
to said Bonds and shall also be deemed to include the out-
standing Water Revenue Bonds dated June l, 1956 and Water
Revenue Bonds, Series 1965, dated June l, 1965, referred
to in the preamble hereof and the interest coupons attached
thereto and also any bonds and the interest coupons attached
thereto subsequently issued pursuant to and within the
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limitations, restrictions and conditions contained in this
ordinance providing for the creation of additional parity
obligations payable from the revenues of said Water System
and having parity as to lien and source and security for
payment from said revenues with the $1,000,000 Water Revenue
Bonds, Series 1970, ~riginally authorized by this ordinance
and said outstanding Water Revenue Bonds dated June l, 1956
and Water Revenue Bonds, Series 1965, dated June l, 1965.
(c) "Holder of bonds" or "bondholder" or any similar
term shall mean any person who shall be the bearer or owner
of any outstanding bond or bonds registered to bearer or not
registered or the registered owner of any outstanding bond
or bonds which shall at the time be registered other than
to bearer or of any coupons representing interest accrued
or to accrue on said bonds.
(d) "Water System" shall mean the complete water sys-
tem now owned by said City or hereafter constructed or
acquired, including the extensions and improvements to be
constructed from the proceeds of the bonds authorized by
this ordinance or from any other sources, together with all
lands or interest therein, plants, buildings, machinery,
franchises, pipes, fixtures, equipment and all property now
or hereafter owned or used in connection therewith and in-
cluding all parts thereof.
(e) "Revenues" shall mean all moneys received by the
City in the payment of the rates, fees and charges for
water furnished by the Water System and all other income
derived by the City from the operation or ownership of the
Water System.
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(f) "Current Expenses" shall mean the City's reason-
able and necessary current expenses of maintenance, repair
and operation of the Water System and shall include, without
limiting the generality of the foregoing, all ordinary and
usual expenses of m~intenance, repair and operation, which
may include expenses not annually recurring, all adminis-
trative expenses and any reasonable payments to pension or
retirement funds properly chargeable to the Water System,
insurance premiums, engineering expenses relating to main-
tenance, repair and operation, fees and expenses of the
paying agents for the bonds as hereinafter set forth, legal
expenses, any taxes which may be lawfully imposed on the
Water System or the income therefrom and reserves for such
taxes and any other expenses required to be paid by the
City under the provisions of this ordinance or by law, but
shall not include any reserves for extraordinary mainten-
ance or repair or any allowance for depreciation or any
deposits to the credit of the special funds provided by
this ordinance.
(g) "Net Revenues" for any particular period shall
mean the amount of the excess of the Revenues of the Water
System over Current Expenses during such period.
Section 2. That the City construct extensions and im-
provements to the municipal Water System of said City, which is a
specific undertaking from which said City derives a revenue, and
for the purpose of paying the cost thereof there be borrowed by
and on behalf of said City the sum of One Million Dollars
($1,000,000) and in evidence thereof there be issued Water Revenue
Bonds, Series 1970, of said City in the principal amount of $1,000,000,
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which bonds shall not be included within the limitation of in-
debtedness of said City contained in Section 127 of the Consti-
tution of Virginia and Section 15.1-176 of the Code of Virginia
1950, as amended, but shall be payable as to both principal and
interest exclusively from the Revenues of said Water System, all
as hereinafter more specifically provided.
Section 3. That said Water Revenue Bonds, Series 1970,
be numbered consecutively i to 200, inclusive, of the denomina-
tion of $5,000 each, be dated December l, 1970, and become due
and payable in numerical order on June I of the respective years
as follows:
Year Amount
1995. $34.0,000
199b 3b0,000
1997 300,000
provided, however, all of said bonds shall be optional for re-
demption prior to maturity in whole or from time to time in part
in the inverse order of their maturities (less than all of a
single maturity to be selected by lot) at any time on or after
June l, 1980, at the redemption prices set forth below, together
with the interest accrued thereon to the date fixed for redemp-
tion:
If Redeemed
Redemption Price
(Percentage of
Principal Amount
On or after June 1, 1980,
to and including June l, 1985
Thereafter to and including June 1, 1990
Thereafter to and including June 1, 1995
Thereafter to maturity
lO7%
lO5%
lO3%
lOl
Notice of any such redemption identifying the bonds to be re-
deemed will be given by publication at least once not less than
thirty (30) days prior to the redemption date in a newspaper or
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financial journal of general circulation published in the City
of New York, New York. All of said bonds thus called for re-
demption and for the redemption of which funds are duly provided
will cease to bear interest on such redemption date.
That said bonds shall bear interest at the coupon
rate of eight per cent (8%) per annum (or at such lesser rate
or rates of interest as may be determined and fixed by the
Council as a result of competitive bidding and public sale of
said bonds as hereinafter provided), which interest will be pay-
able semiannually on June i and December i in each year~ that
such interest be evidenced by proper coupons attached to each
of said bonds and that both principal and interest be payable
in lawful money of the United States of America at the principal
office of The First and Merchants National Bank of Richmond, in
the City of Richmond, Virginia, or, at the option of the holder
of the respective bonds and interest coupons, at the principal
office of The Chase Manhattan Bank (National Association) in the
City of New York, New York. Said bonds shall be executed by the
Mayor and City Treasurer of said City by their manual or fac-
simile signature, sealed with the corporate seal of said City
either by impression or facsimile and attested by the manual
signature of the City Clerk of said City, and the interest coupons
attached to said bonds shall be executed with the facsimile sig-
natures of said Mayor, City Treasurer and City Clerk, and said
officials shall adopt as and for their own proper signatures
their respective facsimile signatures appearing on said coupons.
All of said bonds, together with the interest thereon and addi-
tional bonds ranking on a parity therewith heretofore issued and
outstanding or that m~y be hereafter issued and outstanding from
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time to time under the conditions and restrictions hereinafter
set forth, shall be payable as hereinafter more specifically
provided only out of the Principal and Interest Fund, heretofore
created by said ordinance adopted September 3, 1958, and said
bonds shall be a valid claim of the holder thereof only against
said fund and the portion of the Net Revenues of the municipal
Water System of said City pledged to said fund.
Section 4. That upon presentation at the office of
the City Clerk of said City of any of said bonds same may be
registered as to principal in the name of the owner on the books
in his office, such registration to be noted on the reverse side
of the bonds by the City Clerk, and thereafter the principal of
such registered bonds shall be payable only to the registered
holder, his legal representatives or assigns. Such registered
bonds shall be transferable to another registered holder or back
to bearer only upon presentation to the City Clerk with a legal
assignment duly acknowledged or proved. Registration of any
of such bonds shall not affect the negotiability of the coupons
thereto attached, but such coupons shall be transferable by de-
livery merely.
Section 5. That said bonds and coupons and provisions
for registration shall be in substantially the following form:
No.
(Form of Bond)
UNITED STATES OF AMERICA
COMMONWEALTH OF VIRGINIA
CITY OF FAIRFAX
WATER REVENUE BOND
SERIES 1970
$5,000
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KNOW ALL MEN BY THESE PRESENTS that the City of Fair-
fax, in the Commonwealth of Virginia, for value received, hereby
promises to pay to bearer or, if this bond be registered, to the
registered holder hereof, as hereinafter provided, the sum of
Five Thousand Dollars ($5,000) on the first day of June, 19 ,
and interest on said sum from the date hereof until paid at the
rate of per cent ( ~) per annum,
payable semiannually on June i and December i in each year, except
as the provisions hereinafter set forth with respect to prior re-
demption may become applicable hereto, all such interest as may
accrue on and prior to maturity hereof to be paid upon presenta-
tion and surrender of the annexed interest coupons as the same
severally mature, both principal and interest being payable in
lawful money of the United States of America at the principal
office of The First and Merchants National Bank of Richmond, in
the City of Richmond, Virginia, or, at the option of the holder
hereof, at the principal office of The Chase Manhattan Bank
(National Association) in the City of New York, New York.
This bond is one of a series of bonds numbered consecu-
tively i to 200, inclusive, aggregating $1,000,000 principal
amount, issued by said City for the purpose of paying the cost
of constructing extensions and improvements to the municipal Water
System of said City as authorized by the qualified voters of said
City voting at an election duly called, noticed and held for said
purpose under and in full compliance with the Constitution and
Statutes of Virginia, including among others Paragraph (b) of
Section 127 of said Constitution and Sections 15.1-1?O et seq. of
the Code of Virginia 1950, as amended, and Chapter 8 of the Charter
of said City and pursuant to an ordinance duly adopted by the Coun-
cil of said City.
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The bonds of the series of which this bond is one
shall be optional for redemption prior to maturity in whole or
from time to time in part in the inverse order of their matur-
ities (less than all of a single maturity to be selected by lot)
at any time on or after June l, 1980, at the redemption prices
set forth below, together with the interest accrued thereon to
the date fixed for redemption:
If Redeemed
Redemption Price
(Percentage of
Principal Amount)
On or after June l, 1980,
to and including June l, 1985 107%
Thereafter to and including June l~ 1990 105%
Thereafter to and including June l, 1995 1OB%
Thereafter to maturity lOl%
Notice of any such redemption identifying the bonds to be redeemed
will be given by publication at least once not less than thirty
(30) days prior to the redemption date in a newspaper or financial
journal of general circulation published in the City of New York,
New York. All of said bonds thus called for redemption and for
the redemption of which funds are duly provided will cease to
bear interest on such redemption date.
This bond and the s~ries of which it is one with inter-
est thereon, together with additional bonds ranking on a parity
therewith heretofore issued and outstanding and that may be here-
after issued and outstanding from time to time under the condi-
tions and restrictions set forth in said ordinance, are payable
only from the Net Revenues to be derived from the operation of
said municipal Water System, a sufficient portion of which has
been ordered set aside and pledged as a special fund heretofore
created and identified as the "Principal and Interest Fund."
This bond does not constitute an indebtedness of said City within
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the meaning of any constitutional, statutory or charter limi-
tations, but said City covenants that it will fix such rates
and charges for services rendered by said Water System and
collect and account for receipts and revenues therefrom suf-
ficient to pay promptly the principal of and interest on this
bond and the series of which it is one and all other bonds rank-
ing on a parity therewith as may be outstanding from time to time.
This bond is fully negotiable but may be registered
as to principal only in the name of the holder on the books of
said City in the office of its City Clerk, such registration
being noted hereon by the City Clerk, and after such registration
no transfer shall be valid unless made on said books and similarly
noted on the bond, but it may be discharged from such registration
by being transferred to bearer, after which it shall be transfer-
able by delivery, but it may be again registered as before. The
registration of this bond as to principal shall not restrain the
negotiability of the coupons by delivery merely.
It is hereby certified, recited and declared that all
acts, conditions and thi~s required to exist, happen and be
performed precedent to and in the issuance of this bond and the
series of bonds of which it is one have existed, have happened
and have been performed in due time, form and manner as required
by law~ and that the amount of this bond, together with all other
obligations of said City, does not exceed any limit prescribed
by the Constitution or Statutes of Virginias and that a sufficient
portion of the Net Revenues of said Water System has been ordered
set aside and will be set aside into said special fund by said
City and applied to the payment of the principal of and interest
on this bond and all other bonds ranking on a parity therewith
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heretofore or hereafter issued and outstanding as the same will
become due.
IN WITNESS WHEREOF, said City of Fairfax, in the
Commonwealth of Virginia, has caused this bond to be executed
by its Mayor and City Treasurer by their manual or facsimile
signature and its corporate seal to be impressed or imprinted
hereon, attested by the manual signature of its City Clerk, and
the coupons hereto attached to be executed with the facsimile
signatures of said Mayor, City Treasurer and City Clerk, and
this bond to be dated the first day of December, 1970.
Mayor
Attest:
City Treasurer
City Clerk
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1971-3
(Form of Coupon)
No.
On the first day of .... , 19 , the City
of Fairfax, Virginia, will pay to bearer
Dollars (4 ) out of the Principal and Interest Fund at
The First and Merchants National Bank of Richmond, in the City
of Richmond, Virginia, or, at the option of the holder hereof,
at The Chase Manhattan Bank (National Association) in the City
of New York, New York, as provided in and being interest then
due on its Water Revenue Bond, Series 1970, dated December l,
1970, Number
Mayor
City Treasurer
Attest:
City Clerk
(Form for Registration to be printed
on the back of each bond)
Date of
Registration
In Whose Name
Registered
Signature of
City Clerk
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Section 6. That responsive to Section 13 of said
ordinance adopted September 3, 1958 and Section 8 of said
ordinance adopted June 8, 1965, it is hereby found and declared
that prior to the issuance of any of the bonds hereby author-
ized there will have been procured and filed with the City Clerk
of said City a statement by Alvord, Burdick & Howson, Engineers,
of Chicago, Illinois, an independent firm of consulting engineers,
as the term "independent firm of consulting engineers" is defined
in said ordinances, reciting the opinion based upon necessary
investigations that the estimated Net Revenues of the municipal
Water System of said City, as the term "Net Revenues" is therein
defined, in each of the succeeding calendar years will be not
less than 1.30 times the combined interest and principal re-
quirements for the corresponding calendar years for the bonds
presently outstanding and the bonds herein authori ~d and pro-
posed to be issued, and it is hereby further represented and
declared that prior to the issuance of any of the bonds hereby
authorized contracts for the immediate construction of the ex-
tensions and improvements for account of which such bonds have
been hereby authorized shall have been entered into; and,
accordingly, it is hereby further found and declared that the
bonds hereby authorized shall be payable from the Net Revenues
of the municipal Water System of said City and from the "Prin-
cipal and Interest Fund" on a parity with the Water Revenue
Bonds dated June l, 1956, and Water Revenue Bonds, Series 1965,
dated June l, 1965, of the City heretofore issued and presently
outstanding.
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1971-3
Section 7. That all proceedings preliminary to and
in connection with the issuance of the Water Revenue Bonds dated
June l, 1956, and Water Revenue Bonds, Series 1965, dated June l,
1965, heretofore issued and presently outstanding, and partic-
ularly the ordinances adopted September 3, 1958 and June 8,
1965, whereby provisions were made for the operation of the
municipal Water System~ for the imposition, charging and col-
lection of rates for all services rendered by said Water System
to said City and its citizens, corporations or others served
thereby; for the creation of special funds designated as "Revenue
Fund," "Operation and Maintenance Fund," "Principal and Interest
Fund," "Reserve Fund," "Renewal, Replacement and Extension Fund"
and "Bond Redemption Fund" and for the payments into said special
funds and withdrawals therefrom of specified amounts for author-
ized purposes~ for the keeping of proper books of record and
account and the auditing thereof; for the restricted sale, lease,
mortgage or other disposal of said Water System, including any
and all extensions and additions that may be made thereto~ for
the adoption of an annual budget for Current Expenses of said
Water System; for carrying of insurance~ for the modification or
amendment of the ordinances and of this ordinance~ and for the
enforcement and payment of said bonds, are all hereby ratified
and confirmed and shall continue in force and inure to bhe secur-
ity and benefit of the bonds herein authorized the same as if
such provisions and proceedings were herein set out in full; pro-
vided that the amount of the Net Revenues of said municipal Water
System to be paid into the "Principal and Interest Fund" during
the respective calendar years shall be sufficient to pay when due
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1971-3
the interest on and principal of all of said bonds dated June l,
1956, June l, 1965, and the bonds herein authorized to be issued
and also any additional bonds ranking on a parity therewith that
may be issued and outstanding under the conditions and restrictions
hereinafter set forth. It is hereby determined that from and after
the issuance of any of the bonds hereby authorized the minimum
amount to be paid into said Principal and Interest Fund each month
shall be increased over the amount as provided by said ordinances
adopted September B, 1958 and June 8, 1965, by an amount equal to
not less than one-sixth of the amount of interest on the bonds
issued pursuant to this ordinance which will mature and become
due on the next semiannual interest payment date and an amount
equal to not less than one-twelfth of the amount of principal (if
any) of the bonds issued pursuant to this ordinance which will
mature and become due on the next annual principal maturity date.
It is hereby recognized that in and by said ordinances adopted
September B, 1958 and June 8, 1965, provisions were included for
the accumulation in the "Reserve Fund" of an amount equal to the
maximum amount that will become due in any succeeding calendar
year for both principal and interest on all bonds then outstand-
ing which are payable from the Principal and Interest Fund and
further that upon the issuance of any additional parity bonds
provision must be made for the accumulation in the Reserve Fund
within the first ten years after the issuance of such additional
bonds of a reserve equal to at least the maximum amount of prin-
cipal and interest becoming due in any succeeding calendar year
on all bonds then outstanding, and said proceedings are hereby
ratified and confirmed. It is hereby recognized that there is
presently in said Reserve Fund the sum of $ 361,774.59 , and it is
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1971-3
hereby agreed that from and after the issuance of any of the
bonds hereby authorized there shall be set aside into said Reserve
Fund each month an amount equal to 20% of the monthly payments
required to be paid into the Principal and Interest F~nd as pro-
vided in said ordinances adopted September 3, 1958 and June 8, 1965,
and in this ordinance so that within ten years after the issuance
of the bonds hereby authorized the amount accumulated and main-
tained in said Reserve Fund will be equal to at least the maximum
amount of principal and interest becoming due in any succeeding
calendar year on all bonds then outstanding.
Section 8. The bonds hereby authorized from time to
time outstanding, together with additional bonds ranking on a
parity therewith heretofore issued and outstanding or that may
be hereafter issued and outstanding under the restrictions and
conditions hereinafter set forth, shall not be entitled to prior-
ity one over the other in the application of the Revenues of said
Water System regardless of the time or times of their issuance.
Said City hereby covenants and agrees so long as any of the bonds
issued pursuant to this ordinance are outstanding and unpaid no
other bonds or obligations payable from the Revenues of said
Water System or from any improvements or extensions thereof will
be issued or incurred unless the security and obligation of pay-
ment from such Revenues are made subject to the priority of the
payments from the Revenue Fund into the Principal and Interest
Fund and Reserve Fund for account of the bonds hereby authorized
and any additional parity bonds as may be outstanding from time
to time. Said City hereby reserves the right and privilege of
issuing additional bonds from time to time payable from said
Principal and Interest Fund ranking on a parity with the bonds
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1971-3
herein authorized in order to pay the cost of future extensions,
betterments or improvements to the municipal Water System of said
City~ but before any such bonds ranking on a parity may be issued
for such future extensions, betterments or improvements, there
shall be procured and filed with the City Clerk of said City a
statement by an independent consulting engineer or firm of con-
sulting engineers reciting the opinion based upon necessary in-
vestigations that the estimated Net Revenues of the municipal
Water System of said City in each of the succeeding calendar
years will be not less than 1.30 times the combined interest and
principal requirements for the corresponding calendar years for
all bonds to be outstanding after the issuance of such additional
bonds. In making the foregoing computations such consulting
engineer or firm of consulting engineers shall take into con-
sideration the past experienced revenues of said Water System
with adjustments to reflect any increases by reason of any re-
vision in the schedule of rates and charges being imposed at the
time of the issuance of such additional bonds, by reason of the
extensions, betterments and improvements the cost of which is to
be paid through the issuance of such additional bonds and by
reason of any projected population growth in the area served by
said Water System.
In no event shall any such additional bonds be issued
unless prior to the issuance thereof contracts for the immediate
construction or acquisition of the extensions, betterments and
improvements for account of which such additional bonds are to
be issued shall have been entered into.
The interest payment dates for all such additional
parity bonds shall be semiannually on June I and December i of
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1971-3
each year with the principal maturities thereof on June i of
any year in which any such principal is scheduled to become due.
At or before the time of issuance of any such addition-
al parity bonds as aforesaid provision shall be made for the pay-
ment into the Principal and Interest Fund each year in equal
monthly installments of sufficient additional Net Revenues of
said Water System to pay the interest on such additional bonds
as it becomes due, to pay the principal thereof at or before
maturity and to accumulate in the Reserve Fund within the first
ten years after the issuance of such additional bonds a reserve
equal to at least the maximum amount of principal and interest
becoming due in any succeeding calendar year on all the bonds
then outstanding.
Section 9. The proceeds of the bonds hereby author-
ized, exclusive of accrued interest and except as hereinafter
otherwise provided, shall be applied to the extent necessary in
paying the cost of constructing extensions and improvements to
the municipal Water System of said City in accordance with the
plans and specifications therefor prepared by Alvord, Burdick &
Howson, Engineers, of Chicago, Illinois, now on file with the
City Clerk and which extensions and improvements are generally
described as consisting of an earthen dam across Beaver Dam
Creek and necessary appurtenances thereto. The financing cost
and incidental e~penses attributable to the preparing, printing
and selling of the bonds hereby authorized shall be paid from
the proceeds of said bonds upon orders of the Council. The pro-
ceeds of said bonds thus set apart for construction costs shall
be paid out only upon certification by the firm of Alvord, Burdick
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· 1971-3
& Howson or other independent consulting engineer or firm of
consulting engineers retained by the City to supervise the
construction work to the effect that the respective amounts of
such expenditures represent amounts due and payable for land
acquisition, materials furnished or work or services performed
in connection with the construction of the extensions and im-
provements to the municipal Water System being financed by the
bonds hereby authorized. Pending expenditure such proceeds shall
be deposited in a bank or ban~which are members of the Federal
Deposit Insurance Corporation and each such deposit to the ex-
tent it causes the aggregate deposit by said City in any such
bank to be in excess of the amount insured by the F.D.I.C. shall
be secured by a surety bond or bonds furnished by a surety com-
pany or companies qualified or authorized to do business in
Virginia or by a pledge of direct obligations or by guaranteed
bonds or securities of the United States of America having a
market value equivalent to such deposit. If the Council shall
determine at any time that the amount of bond proceeds being
held for construction costs is in excess of the amount neces-
sary to be disbursed therefrom for the authorized purposes during
the ensuing month, it may invest such excess in interest bearing
bonds or other direct and general obligations of the United
States of America having a maturity date or being subject to
retirement at the option of the holder not more than eighteen
months subsequent to the date of such investment; and all such
investments, as well as all income therefrom, shall be carried
to the credit of such construction fund. Any surplus remaining
after accomplishing the aforesaid purposes shall be converted
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· 1971-3
into the Reserve Fund. All accrued interest which may be re-
ceived from the sale of any of the bonds hereby authorized
shall be converted into said Principal and Interest Fund.
The City covenants and agrees that the aforementioned
extensions and improvements will be constructed expeditiously
and the allocation of the proceeds of the bonds hereby author-
ized to the payment of the cost thereof will be made promptly
in order that said extensions and improvements will be completed
and in operation at the earliest possible date.
The City further covenants and agrees that any pro-
visions in this ordinance to the contrary notwithstanding it
will take no action which would result in making the interest
payable on any of the bonds hereby authorized subject to federal
income taxes by reason of said bonds being classified as "arbi-
trage bonds" within the meaning of Section lO~(d) of the Internal
Revenue Code of 1954, as amended.
Section 10. The term "independent consulting engineer
or firm of consulting engineers" as used in this ordinance shall
be deemed to mean the firm of Alvord, Burdick & Howson, Engineers,
of Chicago, Illinois, so long as said firm is retained by said
City upon terms which are satisfactory to and agreeable with said
City, or otherwise any other consulting engineer or firm of con-
sulting engineers of similar reputation in water system matters
that may be hereafter retained by said City to act in a similar
capacity.
Section ll. That the bonds hereby authorized be exe-
cuted as herein provided as soon after the adoption of this or-
dinance as may be, and in accordance with the provisions of
Section 8.6 of Chapter 8 of the Charter of said City, the City
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1971-3
Clerk is hereby authorized and directed to cause notice to be
published in the Virg__inia Sentinel
a newspaper published in Fairfax .., Virginia, and having
a general circulation in the City of Fairfax, and in Th___~e Daily
Bond Bu__u~, a financial journal published in the City of New York,
New York, that at a time and place stated in such notice, which
shall be the time and place of a scheduled meeting of this Council,
sealed proposals will be considered by this Council for the pur-
chase of the bonds as herein authorized. Such notice shall be so
published at least once not less than ten days prior to the sche-
duled date of sale; such notice shall be in the customary form
and shall recite that no bid for less than all of said bonds nor
for the purchase thereof upon terms of less than 98% of par plus
accrued interest will be given favorable consideration and shall
further state that the right is reserved to reject any or all
bids. In addition the City Manager is hereby authorized to reply
officially to any reasonable request for further information with
respect to the character and security of the bonds.
Section 12. It is hereby recognized that under the
provisions of Section 6(a) of said ordinance adopted September
1958, the municipal Water System was to be operated on an annual
budget year commencing as of January I of each year; however, due
to a state program requiring standardization of reporting dates
for municipal utilities, including water systems, on a fiscal
year basis, it has been necessary to revise the annual budget
year of said municipal Water System and it is hereby represented
and declared that the municipal Water System of said City is now
operated on an annual budget year commencing as of July I of each
year and ending on June 30 of the following year.
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1971-3
SectioB l~... That the provisions of this ordinance
shall constitute a contract between said City of Fairfax and the
holder or holders of the bonds herein authorized to be issued;
provided that modifications or amendments of this ordinance may
be made in the same manner and subject to the same conditions as
set forth under Section 18 of said ordinance adopted September 3,
1958. It is hereby represented and covenanted that no such modi-
fications or amendments to said ordinance adopted September 3,
1958 and June 8, 1965, have been heretofore made.
Section 14. If any section, paragraph, clause or pro-
vision of this ordinance shall be held to be invalid, the in-
validity of such section, paragraph, clause or provision shall
not affect any of the remaining provisions of this ordinance.
Sec~ion l~.. That Ordinance No. 1969-3 adopted by the
Council of said City on May 20, 1969 authorizing and providing
for the issuance of $700,000 Water Revenue Bonds, Series 1966,
of said City is hereby specifically repealed and none of said
bonds shall hereafter be issued and delivered. All other or-
dinances, resolutions and orders, or parts thereof, in conflict
with the provisions of this ordinance are to the extent of such
conflict hereby repealed.
Section 16. This ordinance shall be in full force and
effect upon its adoption and approval by the Mayor.
Adopted by the Council February 1~..., 1971·
Approved February 16 , 1971.
Attest:
~i~y Clerk
The above ordinance is hereby certified to and approved
by me as to legality and correctness of form this day of
,,, 1971.
City' Attorney
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